NOTE 28 - COMMITMENTS Lease Agreements Other than those commitments under lease agreements as described in Note 3 to the financial statements, the Company and its subsidiaries have entered into lease agreements covering spaces for branch offices, base stations, cars and others for periods ranging from 11 months to 20 years with options to renew. The Company and its subsidiaries are committed to pay for rental in respect of the said agreements as follows: Million Baht Per Month For Advanced Info Service Public Company Limited 14.31 For Advanced Info Service Public Company Limited and subsidiaries 16.26 Bank Guarantees At March 31, 1999, the Company and its subsidiaries had commitments with banks whereby the latter issued letters for guaranteeing the Company and its subsidiaries in respect of business contracts, electricity use, customs duties and others in the following amounts: Million Baht For Advanced Info Service Public Company Limited 3,595.12 For Advanced Info Service Public Company Limited and subsidiaries 3,713.81 Contracts for Construction and Equipment Installation of Mobile Phone and Pager Networks At March 31, 1999, the Company and its subsidiary had outstanding commitments under contracts relating to the construction and installation of equipment for the operations of mobile phone and pager networks amounting to approximately Baht 1,481.72 million. Data Broadcast Via Satellite Agreement The Company's subsidiary has entered into a Data Broadcast via Satellite agreement with the Telephone Organization of Thailand for a period of 5 years with option to renew. The subsidiary is committed to pay for rental in respect of the said agreement in the amount of Baht 35,000 per site per month for master network and Baht 6,000 per site per month for remote network. Interest Rate and Currency Exchange Agreements In order to hedge against the risk of possible losses from future repayments of loans and the payments of related interest, deriving from exchange rates and interest rates under loans in foreign currencies, the Company has entered into two interest rate and currency exchange agreements to exchange the US dollar loan principals from US$ 26,824,731.97 to Baht 678,527,471.52, and to exchange the related loan interest rates on US dollar principals (comprise a fixed rate of 6.88% per annum and 6 month LIBOR plus the rate per annum as prescribed in each agreement) to the fixed rates on Baht principals at the rate of 9.68% per annum. Value dates of those two agreements are covering from January 15, 1997 to January 15, 2001. As of March 31, 1999, outstanding loan principals under those agreements amounted to US$ 19,144,325.32 and their value dates are covering from July 15, 1999 to January 15, 2001. Forward Exchange Contracts In order to hedge against the risk of exchange losses from future repayments of foreign currency loans and the payments of related interest, notes payable to foreign supplier, foreign trade accounts payable and liabilities under trust receipts, the Company and its subsidiary have entered into nine currency exchange contracts to cover loans, interest, notes payable to foreign supplier, trade accounts payable and liabilities under trust receipts from a total amount of US$ 33,416,906.49 to Baht 1,251,267,884.73. Value dates of these nine contracts are covering from April 30, 1999 to December 30, 1999. The Company has also entered into two sale forward contracts, to sell US$ 13,000,000 from April 12, 1999 to December 27, 1999 for the total contracted amount of Baht 502,740,000. Principal Only Swap Contracts In order to hedge against the risk of exchange losses from future repayments of foreign currency loans and the payments of related interest, the Company has entered into seven currency exchange contracts to cover loans and related interest from a total amount of US$ 48,625,000 to Baht 1,806,112,500. Value dates of these seven contracts are covering from September 30, 1999 to September 29, 2000. Interest Rate Exchange Agreements In order to hedge against the risk of losses from interest payments, which may derive from the fluctuation of interest rates under foreign loans, the Company has entered into seven interest rate exchange agreements, to exchange the related interest rates on US dollar loan principals of US$ 88,635,790 (comprise 6 month LIBOR plus the rate per annum as prescribed in each agreement) to the fixed rates on US dollar loan principals ranging from 5.43 - 6.215% per annum. Periods of those seven agreements are covering from March 30, 1998 to September 15, 2002. As of March 31, 1999, outstanding loan balances relating to those interest rate agreements amounted to US$ 70,385,790, and are covering from March 15, 1999 to September 15, 2002. Letters of Credit At March 31, 1999, the Company's subsidiary had commitments under letters of credit with overseas suppliers amounting to approximately Baht 46.20 million. Purchase Orders As at March 31, 1999, the Company had purchase commitments with respect to the construction and installation of equipment for the operations of mobile phone network amounting to approximately Baht 649.08 million. NOTE 29 - COMPUTER REMEDY PLAN FOR THE YEAR 2000 (UNREVIEWED BY THE AUDITORS) The Year 2000 problem arises because many computerized systems use two digits rather than four to identify year. Date-sensitive systems may recognize the year 2000 as some other dates, resulting in errors when information using year 2000 dates is processed. Entities may experience the effects of Year 2000 problem before, on, or after January 1, 2000, and that the effects on operations and financial reporting, if not addressed and repaired properly and timely, may range from minor errors to significant systems failure which could affect an entity's ability to conduct normal business operations. In addition, it is not possible to be certain that all aspects of the Year 2000 problem affecting the entity, including those related to the efforts of customers, suppliers, or other third parties, will be fully resolved. The management of the Company and subsidiaries have instructed their Management Information System Divisions to study the existing computer systems, applications and hardware to develop a computer remediation plan for the year 2000. As of March 31, 1999, the computer remedy projects of the Company and its subsidiaries had not been completed. Estimated expenditure of the computer remedy projects for the Company and its subsidiaries amount to approximately Baht 55 million. Expenditure of the computer remedy projects will be recorded as assets if the replacement of computer systems, applications and hardware are made; and will be recorded as period costs when incurred if the modifications for year 2000 compliance are made. Expenditure incurred up to March 31, 1999 relating to Year 2000 projects for the Company and its subsidiaries are approximately Baht 21.09 million, comprised expenses amounting to approximately Baht 1.68 million and assets amounting to approximately Baht 19.41 million. Although computer remedy projects of the Company and its subsidiaries are expected to be completed and implemented before the year 2000, the Company and its subsidiaries still face risks that other parties with which the Company and its subsidiaries do business may be unsuccessful in their computer remedy projects within the time limit. However, the management of the Company and its subsidiaries expect that the impact, if any, will not be significant to the operations of the Company and its subsidiaries. NOTE 30 - SUBSEQUENT EVENT From April 1, 1999 through April 16, 1999, the Company entered into eight currency exchange agreements to cover loans, interest and trade accounts payable from a total amount of US$ 36,100,000 to Baht 1,350,082,750. Value dates of these eight agreements are covering from September 29, 1999 to March 30, 2000. NOTE 31 - RECLASSIFICATION OF ACCOUNTS Certain accounts in the financial statements for the three month period ended March 31, 1998 have been reclassified to conform with the presentation in the financial statements for the three month period ended March 31, 1999.